Financial Discussion

Emergency savings

Emergency savings

Posted: Fri Jun 06, 2008 3:47 pm

by ms.piggy

I've read somewhere that we need to have emergency savings of about 6 months our salary. Does anyone have that kind of money in savings account or am I missing something? We don't have that kind of cash and I am worried that with the rising prices of gas and food we won't be able to save any money. Do you have any suggestions and do you have money for emergencies?

Re: Emergency savings

Posted: Fri Jun 06, 2008 6:15 pm

by stocks

I don't have savings equal to 6 months of my salary, I don't think that you need that much savings. All my investments go into my house, which has appreciated nicely in the last 5 years. If I need an emergency cash I will get a home equity loan, and I'll be just fine.

Re: Emergency savings

Posted: Fri Jun 06, 2008 6:45 pm

by spencer

stocks wrote:I don't have savings equal to 6 months of my salary, I don't think that you need that much savings. All my investments go into my house, which has appreciated nicely in the last 5 years. If I need an emergency cash I will get a home equity loan, and I'll be just fine.

The fact that you don't have such savings, and you cannot afford to save doesn't mean anything. You definitely need at least 6 months of living expenses savings period. What happens if you lose your job and you can't find a new one for a few months? If you think this can't happen, think again. Of course you have the answer for that too - you'll get a home equity loan, how convenient. I don't know if you have heard about it, but the era of using your home as ATM is over. Getting home equity is not easy anymore. Wake up! Canada and US are in recession already and you are dreaming about house appreciation. By the end of the year your house price will most likely start declining and maybe then you'll realise that there is something wrong and you should start saving. The thing is that it will be already too late. The time to save is now!

Re: Emergency savings

Posted: Mon Jun 09, 2008 3:00 pm

by dreamy

It is a good idea to have money for emergencies. You never know what can happen so you better have some cash. Have at least 3 months your salary and start to save from your next paycheck.

Re: Emergency savings

Posted: Tue Jun 10, 2008 3:00 pm

by ms.piggy

dreamy wrote:It is a good idea to have money for emergencies. You never know what can happen so you better have some cash. Have at least 3 months your salary and start to save from your next paycheck.

I don't own a house and I have bad credit. How am I supposed to save?

Re: Emergency savings

Posted: Fri Sep 26, 2008 11:45 am

by proplanner

Everyone should have an emergency fund and there is no specific rule like you should have 3 months or 6 months salary.

You should have that much of amount that can help you in any type of financial problem.

Re: Emergency savings

Posted: Tue Dec 02, 2008 3:35 pm

by spencer

proplanner wrote:You should have that much of amount that can help you in any type of financial problem.